Working on a Healthcare Plan For All

Republican healthcare Plans

The president has had some proposals which were viewed as having merit:

  1. require hospitals to post their actual, negotiated prices
  2. some strategies to lower drug prices.

On the other hand, he has loosened the rules on health insurers to allow sales of what critics call “junk” insurance because they don’t have all the consumer protections of ACA policies, or promoting work requirements for Medicaid recipients.[1]

 Other administrative activities have included:[2]

  1. In October 2018, the Departments of HHS, the Treasury, and Labor proposed a rule that would provide employers with significant new flexibility in how they fund health coverage through Health Reimbursement Arrangements (HRAs).

PROS FOR EMPLOYERS[3]

  • Cost Control-Employers choose how much to contribute to each employee’s HRA account every year.
  • Tax-Advantaged Account-Employer contributions to the plan are 100% tax deductible.
  • Flexibility-employer has the ability to design a plan that best suits the needs of its workforce
  • Low Risk-Employers do not pay out on covered expenses until after a claim is filed and adjudicated, reducing potential for benefit fraud.
  • Talent Recruitment-A well-rounded benefits package can help employers attract and retain talent.

PROS FOR EMPLOYEES(?)

  • Lower Healthcare Costs-If an HRA is offered along with an HDHP, lower premiums can result in reduced  healthcare costs for employees (BEWARE THE HIGH OUT OF POCKET DEDUCTIBLE).*
  • Personal Healthcare Freedom– Individuals have greater choice over their healthcare decisions and can use the available funds to cover eligible out-of-pocket medical expenses.
  • Does Not Affect Income– employer’s contributions do not count toward the employee’s gross income.
  • Tax-free Reimbursement– When an employee files a claim for a qualified medical expense, the reimbursement is tax free.
  • Rollover– If the employer’s plan allows for it, the unused balance can roll over to the following year.

*out of pocket compare chart

-out of pocket healthcare costs chart

benefit coverage data chart

CONS OF HRA

  • No Portability– the employer owns the money in the account though it is there for the individual to use. If the person leaves the company or the job is terminated, the HRA money stays behind with the employer.
  • Standardization Does Not Apply– HRA plans can vary between companies.
  • Ineligibility for the Self-Employed– persons who are self-employed are not eligible for an HRA.
  1. In August 2018, the Departments of HHS, the Treasury, and Labor finalized a rule to expand Americans’ ability to purchase short-term, limited-duration insurance—coverage for which premiums are generally much more affordable than Affordable Care Act (ACA) plans. Millions of Americans, including middle-class families who cannot afford ACA plans, will benefit from the additional choice and competition resulting from this reform.

Short term insurance policies

  • Exclude those with pre-existing conditions;
  • Doesn’t have to offer comprehensive coverage; and
  • Imposes annual/lifetime limits.[6]

short term health plans CHART

  1. In June 2018, the Labor Department finalized a rule to expand the ability of employers, including sole proprietors without common law employees, to join together and offer health coverage through Association Health Plans. For many employers, employees, and their families, these employee benefit plans will offer greater flexibility and more affordable benefits.

Association health plans (AHP)

  • Executive order from President Trump
  • Bid to expand healthcare coverage to small business owners, entrepreneurs and their employees as well as the self-employed
  • Under an AHP, coverage could be less robust, which would mean that the plans would be more likely to attract healthier people.[7]
  1. In May 2018, HHS released “American Patients First,” a historic blueprint for actions to bring down the high price of drugs and reduce out-of-pocket costs. HHS has taken a number of actions that were laid out in the blueprint to empower consumers and promote competition, building on accomplishments such as the Food and Drug Administration’s record pace of generic drug approvals.

The blueprint itself is more prescriptive and would be utilized by payers to negotiate which medications gained increased utilization. This increased utilization would come at a price that would benefit patients in the form of lower out-of-pocket expenses. In the blueprint, the US Department of Health & Human Services (HHS) identifies 4 main challenges in the American drug market:

  • -High list prices for drugs
  • -Seniors and government programs overpaying for drugs due to lack of the latest negotiation tools
  • -High and rising out-of-pocket costs for consumers
  • -Foreign governments free-riding off of American investment in innovation

“This blueprint, if enacted, would require clinical pathways to articulate value to both patients and payers. Clinical pathways will need to become more specific; current broad clinical pathways would be replaced by much more detailed pathways that provide greater direction not only to providers but to patients and insurers as well, which would add much more value.”[8]

  1. In December 2017, you signed the Tax Cuts and Jobs Act, which eliminated the onerous and regressive individual mandate tax penalty. This freed Americans to finance their health care needs in the way that works best for them.

DEFANGING THE INDIVIDUAL MANDATE would result in thirteen million fewer Americans having health insurance and the federal government saving $338 billion over the next 10 year.[9] Premiums in the unsubsidized ACA Individual Exchange Plans will be 6 percent higher than if the individual mandate had not been removed.[10]

  1. The Administration has enacted reforms to deliver better value through choice and competition in the Medicare program, including payment changes that establish site-neutral payment policies for a number of Medicare services, a simplification of how physicians are paid for evaluation and management visits, new consumer-transparency measures, and flexibility for insurers to offer more options and benefits in Medicare Advantage.

Physicians code their encounters with you based on intensity of service. Visit types are generally divided into NEW PATIENT VISIT and ESTABLISHED PATIENT VISIT. CPT (Current Procedural Terminology) coding is used to standardize medical communication across the board, which identifies the services provided and are used by insurance companies to determine how much physicians will be paid for their services.[11] They are considered EVALUATION AND MANAGEMENT (E&M) CODES.

Proposed changes for paying physicians under Medicare:

  • Offering physicians basically the same amount, regardless of the patient’s condition or complexity of services provided
  • One rate for new patients
  • One rate for established patients

For established patients, the proposal calls for a payment rate of about $93 in place of the average ranges of $45 to $148 as you move up the ladder of office visit intensity.[12]

By removing the “paperwork” to document complexity for patient Level 2-Level 5 office visits, the Administration believes they will save 51 hours of clinic time per doctor per year. Does less than an hour per week seem significant to you?

But what is the net impact on you? Critics are saying this could lead to short-changing doctors who care for the sickest, most complicated patients. Ultimately, if you are a sick or complicated patient, this might discourage your physician from accepting your Medicare coverage. What it might do is compound the issue of “upcoding” the intensity of service being provided during an office visit. How? The proposal could increase the risk of “erroneous and fraudulent payments because doctors would submit less information to document the services provided.[13]

  1. HHS and the Treasury have issued revised guidance under section 1332 of the ACA that significantly expands the ability of states to reform their individual insurance markets while ensuring that people with pre-existing conditions are protected.

“Under the Trump Administration guidance, states have substantially more flexibility in the design of 1332 waiver proposals, opening the door to approaches that could materially affect the stability of ACA marketplaces, redistribute subsidy dollars, and change consumers’ access to coverage based on health status, age, income, and other factors.”[14]  By loosening the interpretation of the statutory guardrails and encouraging states to increase access to private coverage, specifically ACA non-compliant coverage:

  1. Waiver programs could subsidize ACA non-compliant plans offered through parallel insurance markets.
  2. States also could reallocate federal subsidy dollars across demographic groups.
  3. States could continue to seek waivers to establish reinsurance programs.
  4. States are discouraged from proposing waivers that expand public programs.
  5. State waiver programs could reduce health insurance premiums for some, even many, state residents BUT parallel markets could divide the risk pool, isolating people with pre-existing conditions, could destabilize ACA-compliant markets. NET RESULT- New counting rules could reduce protection for people with pre-existing conditions. Other marketplace services and protections could be weakened under 1332 waiver programs.

FOOTNOTES:

[1] Appleby, Julie, “Trump Promises ‘Phenomenal’ Health Plan. What Might That Mean?” Kaiser Health news 4 Sep 2019, khn.org/news/trump-phenomenal-republican-health-plan-political-strategy/?utm_source=Sailthru&utm_medium=email&utm_campaign=Newsletter%20Weekly%20Roundup:%20Healthcare%20Dive%2009-07-2019&utm_term=Healthcare%20Dive%20Weekender

[2] U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES, U.S. DEPARTMENT OF THE TREASURY,

U.S. DEPARTMENT OF LABOR, “Reforming America’s Healthcare System Through Choice and Competition”

[3] “HRAs – A Look at the Pros and Cons,” Data Path, https://dpath.com/hras-pros-cons/

[4] adapted from Miller, Robert, “Competition in The Health System: Good News And Bad News,” Health Affairs, Summer 1996, www.healthaffairs.org/doi/full/10.1377/hlthaff.15.2.107

[5] Masterson, Les. “HMO vs PPO vs Other Plans: What’s the Difference?” Insurance.com, 23 Oct. 2018, www.insurance.com/health-insurance/difference-between-ppo-hmo-hdhp-pos-epo.html.

[6] Luhby, Tami. “Trump Administration Unveils Short-Term Health Plans as Alternative to Obamacare.” CNNMoney, Cable News Network, 20 Feb. 2018, money.cnn.com/2018/02/20/news/economy/trump-obamacare-short-term-health-insurance/index.html.

[7] Norris, Louise. “The Problem with Association Health Plans.” Healthinsurance.org, 19 Sept. 2018, www.healthinsurance.org/blog/2018/06/01/the-problem-with-association-health-plans/.

[8] Stephanacci, R., “Understanding the ‘American Patients First‚’ Blueprint: Implications for Clinical Pathways,” Journal of Clinical Pathways, June 2018, https://www.journalofclinicalpathways.com/article/understanding-american-patients-first-blueprint-implications-clinical-pathways

[9] Scott, Dylan. “CBO: 13 Million More Uninsured If You Repeal Obamacare’s Individual Mandate.” Vox.com, Vox Media, 8 Nov. 2017, www.vox.com/policy-and-politics/2017/11/8/16623154/cbo-obamacare-individual-mandate-new-baseline.

[10] Kamal, Rabah, et al. “How Repeal of the Individual Mandate and Expansion of Loosely Regulated Plans Are Affecting 2019 Premiums.” The Henry J. Kaiser Family Foundation, The Henry J. Kaiser Family Foundation, 30 Oct. 2018, www.kff.org/health-reform/issue-brief/how-repeal-of-the-individual-mandate-and-expansion-of-loosely-regulated-plans-are-affecting-2019-premiums/.

[11]  “What Is the Difference between ICD and CPT Coding?” Quora-Ask New Questions, 27 June 2018, www.quora.com/What-is-the-difference-between-ICD-and-CPT-coding.

[12] Jorge, Margarida, and Ethan Rome. “Seniors Will Pay the Price for Trump’s Medicare Cuts.” MarketWatch, MarketWatch, 18 Feb. 2018, www.marketwatch.com/story/seniors-will-pay-the-price-for-trumps-medicare-cuts-2018-02-14.

[13] Pear, Robert. “Sniffles? Cancer? Under Medicare Plan, Payments for Office Visits Would Be Same for Both.” The New York Times, The New York Times, 22 July 2018, www.nytimes.com/2018/07/22/us/politics/medicare-payments-trump.html.

[14] Tolbert, J and K. Pollitz, “New Rules for Section 1332 Waivers: Changes and Implications,” Henry J. Kaiser Family Foundation, 10 Dec 2018, https://www.kff.org/health-reform/issue-brief/new-rules-for-section-1332-waivers-changes-and-implications/

By | 2019-11-05T11:51:46+00:00 January 14th, 2020|Categories: Healthcare|0 Comments

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